FORMER Chester City FC manager Kevin Ratcliffe is starting legal proceedings against the club to recover #200,000 he claims he is owed.

Club owner Terry Smith is refusing to pay the money, despite a ruling by the Football League that he is duty bound to do so.

Mr Ratcliffe, who played for Everton in the 1980s, is now filing a winding-up order against the club.

If the order is successful, the club will be forced to pay Mr Ratcliffe any sum the court rules he is owed.

Mr Ratcliffe claims he was legally entitled to the money when he resigned from the club two years ago.

Last night Mr Ratcliffe said: "I have tried to contact Mr Smith to resolve the situation but I have had no correspondence from him.

"I have been forced to file a winding-up order as a last resort because I have tried every other avenue to recover the money I am owed."

The dispute centres on a contract drawn up by Mr Ratcliffes solicitor and signed by the previous owner of the club, Mark Guterman.

It stated that, should there be a change of ownership that Mr Ratcliffe was not happy with, he could resign and be paid his full salary of #40,000 for each year he had been at the club, a total of #200,000.

Mr Ratcliffe left the club a few months after it was taken over by Mr Smith in 1999.

Mr Smith claimed he knew nothing of the agreement at the time and refused to pay the #200,000.

A subsequent investigation by the Football League ruled the club must pay up, but Mr Smith contested this and pointed out that Chester City was not a member of the Football League when the body made its decision.

But an appeal against the ruling was unsuccessful so Mr Smith applied for the matter to be dealt with by the High Court.

In a statement to the Daily Post, Mr Smith said: "There are several legal issues regarding the decision that the clubs solicitors feel to be wrong and so the club has appealed the decision to the High Court as per the rules and regulations of the Football League appeal procedures.

"This appeal has not yet been heard, but the court has set a hearing date and so at this time the club does not owe Mr Ratcliffe anything."

However, a spokesman for the League Managers Association claimed the matter had already been dealt with by the High Court, which ruled in Mr Ratcliffes favour.

"A High Court judge ruled that it was not a civil case and that the decision of the Football League stands. It is legally binding," said the spokesman.

"We are reluctant to file a winding-up order, but it is our only remaining course of action.

"We are now waiting for some further documents to come through. Once we have them, we expect to move forward straight away."

A winding-up order is the last resort used by an individual or company in order to claim money they allege is owed to them by an organisation. To be eligible to file the order, the aggrieved party must have tried to recover the money by asking for it.

They must also have issued a statutory demand for the money to be paid within 21 days.

The news comes at a turbulent time for the Nationwide Conference outfit.

Two weeks ago, Mr Smith announced he was backtracking on his plans to sell, and instead planned to create a supporter-run club.

But he has come under increasing pressure from supporters to quit, and six players have lodged transfer requests.